In a recent study published by the Center for American Progress, 30 cents of every dollar Americans put toward healthcare is eaten up by administrative costs. That came to a grand total of $1.13 trillion dollars in 2019. Administrative costs have been creeping higher for decades, but this budget strain isn’t new. Growing expenses and the ripple effects it has on our healthcare system is unacceptable, and is at the heart of what drives Signature Performance to solve the challenges facing healthcare.Having a better understanding of what these costs are and how they affect the care provided to our loved ones, neighbors, and communities is key to accomplishing Signature’s vision of creating a legacy of delivering breakthrough performance and commanding results.
What Exactly Are Healthcare Administrative Costs?
The bulk of non-treatment expenses are related to challenges our Associates solve everyday. These billing and insurance-related costs (BIRs) consist primarily of claims submission, reconciliation, and processing. It also extends to proper maintenance of electronic health records (EHR) as well as programs designed to eliminate fraud and abuse.
Another key factor of rising costs is the overall complexity of the healthcare system. The average hospital has to deal not only with public health programs, like Medicare and Medicaid, but also with private insurers, each with its own set of procedures for billing and collecting payment. Hospital business offices have to invest in finding, training, and retaining staff in an industry filled with changing standards and regulations. This overhead adds up and is being passed on to the patient.
How Are These Rising Costs Affecting Patient Care?
The cost isn’t only monetary. On top of taking away dollars that could be going to better treatment, administration complexity also creating a paperwork headache for caregivers. According to EHR Intelligence, doctors and their medical staff spend an average of twenty-two hours a week dealing directly with health plans and payers. This has led to nearly 55% of physicians finding the amount of time spent distracted by these obstacles a significant issue preventing them from treating their patients.
Inefficiencies in the system aren’t just affecting the care being provided. These inefficiencies are actually taking a bigger chunk out of American’s budgets as they seek to afford care in the first place. In an article published by CNBC.com, almost 25% of adults in the U.S. admit to having limited their household spending to help pay for medical treatment. An alarming number directly resulting from healthcare prices affected by administrative costs.
How is Signature Making an Impact?
Signature Performance is unique in our experience working with both payers and providers. Our knowledgeable Associates use this experience when making a difference everyday. By bringing our strengths and dedication to everything we do, we are making a difference and the healthcare industry is noticing. When our medical coders accurately complete a medical record, when our processors successfully submit a claim, or when our Provider Experience
Center representatives help a provider quickly track the status of a payment, we are moving the needle in improving efficiency and lowering administrative costs.
In turn, as more of our healthcare dollars and physician attention are directed toward actual treatment, we are freeing up healthcare providers to invest more in facilities, equipment, and staff. Reining-in administrative costs helps to reduce the cost passed on to the patient and allows people to get quality care that is budget friendly. Ultimately leading to better outcomes for patients and the community. Could anyone ask to be part of building a more worthwhile legacy?
Addison Stoddard is the Senior Experience and Communication Coordinator at Signature Performance Inc., in Omaha, NE. Signature Performance is an industry leader in reducing healthcare administration costs for private and public healthcare sectors. Our unmatched experience in serving both the payer and provider side of healthcare financial management allows us to implement innovative solutions for every administrative demand.